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Equitativa Group, the manager of Emirates REIT, has received the majority certificate holder approval for its proposed refinancing of its $400 million sukuk.
The real estate investment trust’s manager announced that it had received approval from 99% of the 88% who had already voted in favour of the REIT’s proposal, which was first announced last month.
Equitativa said the new refinancing endorses the business plan and underlying valuation of portfolio assets and allows the REIT to progress development and growth plans.
The sukuk, first issued in December 2017, was due to mature this month, but an attempt to refinance it last year was rejected by bondholders.
Equitativa CEO Thierry LeLeu told Zawya earlier this year that the company was maintaining several parallel tracks, including senior refinancing with local banks.
The company said the agreed terms for the new secured certificates included several key features, including a fully secured position and a profit rate increase from 5.125% to 9.5%, which it said reflects the current credit environment with rising inflation, profit rates and market volatility.
The new maturity date will be December 2024, with a one-year extension option.
A statement from the company last month revealed that the proposal included exchanging each $1,000 face amount for a $950 certificate and $50 in cash.
“The company is delighted that the proposed refinancing has received such a strong endorsement from our sukuk holders. This solid approval allows the business to now move forward into 2023 and beyond,” Leleu said.
“The post pandemic environment in Dubai represents an attractive opportunity for the REIT to cement its leading position in the market, whilst at the same time taking advantage of the buoyant commercial real estate market and new opportunities in areas such as logistics and education.”
New tenants in the REIT’s portfolio include Durham School, law firm Watson, Farley & Williams and Smart Salem, which has opened a medical fitness centre, the company said.
(Writing by Imogen Lillywhite; editing by Cleofe Maceda)
